Apple alone now holds 10% of all US corporate cash
Of the $1.48 trillion in cash held by U.S. non-financial companies as of June 30, Apple's $147 billion in reserves accounted for 10 percent of all companies, new data shows.
A new analysis by Moody's, summarized by The Wall Street Journal this week, reveals that Apple's share of U.S. corporate cash grew from 9.5 percent at the end of 2012 to 10 percent in mid-2013. Apple's cash hoard has been the subject of considerable debate, as some investors believe the company should be doing more with its money.
While Apple has the largest share by far, together Microsoft, Google, Cisco and Pfizer account for another 15 percent of all U.S. corporate reserves. According to Moody's, the top 50 companies account for 62 percent.
For years now, Apple has been flush with billions it can't spend fast enough. The company announced plans for a dividend program in March of 2012, along with a $10 billion share buyback program.
Those plans were expanded this year, when Apple Chief Executive Tim Cook announced expanded buyback and dividend plans that will distribute $100 billion from its cash pile through 2015.
But even with those aggressive plans, Apple's cash continues to grow faster than the company can spend it. Its domestic and overseas funds reached $146.6 billion by the end of this year's June quarter.
That's drawn the attention of billionaire investor Carl Icahn, who has begun pushing Apple to spend $150 billion and buy back even more of its own shares. Icahn pitched his plan to Cook and Apple Chief Financial Officer Peter Oppenheimer at dinner in Manhattan this week, in a conversation he admitted got "testy" at times.
A new analysis by Moody's, summarized by The Wall Street Journal this week, reveals that Apple's share of U.S. corporate cash grew from 9.5 percent at the end of 2012 to 10 percent in mid-2013. Apple's cash hoard has been the subject of considerable debate, as some investors believe the company should be doing more with its money.
While Apple has the largest share by far, together Microsoft, Google, Cisco and Pfizer account for another 15 percent of all U.S. corporate reserves. According to Moody's, the top 50 companies account for 62 percent.
For years now, Apple has been flush with billions it can't spend fast enough. The company announced plans for a dividend program in March of 2012, along with a $10 billion share buyback program.
Those plans were expanded this year, when Apple Chief Executive Tim Cook announced expanded buyback and dividend plans that will distribute $100 billion from its cash pile through 2015.
But even with those aggressive plans, Apple's cash continues to grow faster than the company can spend it. Its domestic and overseas funds reached $146.6 billion by the end of this year's June quarter.
That's drawn the attention of billionaire investor Carl Icahn, who has begun pushing Apple to spend $150 billion and buy back even more of its own shares. Icahn pitched his plan to Cook and Apple Chief Financial Officer Peter Oppenheimer at dinner in Manhattan this week, in a conversation he admitted got "testy" at times.
Comments
"Apple to subsidize U.S. Government."
Oh, how I'd pay to see that headline...
Or, in the words of Michael Dell: "I’d shut it down and give the money back to the shareholders".
"Apple to subsidize U.S. Government."
Oh, how I'd pay to see that headline...
With a current budget deficit and a debt of over $16 trillion, there is nothing Apple could do. Since last year, the government debt has raised by about $1.84 billion per day. The US government is too big for even Apple to help. Sorry to break your heart.
The key phrase is "non-financial". It's not the Apple's, MS, Cisco's of the world that is the problem -- they produce stuff. The financial institutions make nothing but money for themselves, and misery for everyone else.
Financial companies are not sitting on anywhere near the same proportion of cash in their balance sheets. Moreover, whatever cash they do have could be a consciously designed asset allocation strategy on their part. Cash is their raw material, if you will. This is very different from non-financial corporations. Hence it makes sense to treat them separately for comparison purposes.
Ask China.
And yet Icahn is telling Apple to get rid of all of its money.
Is there a way for a company to hold a vote of no confidence in its shareholders?
With a current budget deficit and a debt of over $16 trillion, there is nothing Apple could do. Since last year, the government debt has raised by about $1.84 billion per day. The US government is too big for even Apple to help. Sorry to break your heart.
Yeah, it’s called humor. You’ll find that a lot here.
Is there a way for a company to hold a vote of no confidence in its shareholders?
Ask Michael Dell
Didn't the feds have a surplus not that long ago? or was that just a make believe surplus within a budget year that ignores the mountain of debt accumulated in prior years that will take 28,000 years to pay off? Or maybe the actual surplus back in eighteen hundred whatever where the feds paid money back to all land owners (or something along those lines) instead of making strategic investments etc and now the country is in debt so deep that not even James Cameron could make it all the way down there.
So yeah - Apple should do what the feds did - take a secure financial position and piss it away in order to make some folks temporarily happy that they got something for nothing - that'll work.
No, that was a budget surplus, not a financial one. We haven’t been out of debt for decades.
I thought much of that cash originally belonged to those stupid suckers in the UK.
Taxing thoughts.
i try to think of all the crazy things Apple should do with it, but they are so big now, nothing makes sense. I'd love it if they bought a wireless carrier or isp, but they are so regionalized it wouldn't be possible to reach the whole world.
i guess they could always buy Ford.
There is nothing you can do about iHaters, they have a mental affliction. You are projecting a societal mind set (envy of others doing better to put it simply) that doesn't fit in this case.
For the most part, average normal people that use Apple products come from all walks of life and represent all financial levels from the wealthy to the less well off. I don't believe amongst them you would find too many people feeling as you describe. I believe most people that love Apple products are happy to see Apple do well regardless of their personal financial levels.
As I say, those that cling to their PC built from parts at radio shack or their Android (because they were Microsoft lovers and Apple haters and MS don't have a mobile device they like) etc … the hate about Apple's success, be it iO7 adoption rates, money in the bank or Safari's total domination world wide … these things seem to make them crazy. I love it!
Tim Cook has said repeatedly that Apple is a products company, plain and simple. If they became a financial institution all of a sudden that would be diametrically opposed to being a products company. Doesn't make any sense at all
Their product would be money. They print it, as is.
That's some life-changing amount of money right there. I can't even imagine what they could do but fortunately there are some smart people in charge over there in Cupertino. This could transform the company. Buying a carrier is one idea that's been mentioned on AI that makes sense and is horrendous at the same time. Bring Elon Musk on board, heck, Dean Kamen as well, and fund some real "think different" ideas and do some real transformational stuff.
Edit: Ray Ozzie, too. I could go on and on. There are some visionaries and people with great track records. (Ozzie couldn't get traction at MS but I do not hold that against him. I always imagined him there like Don Quixote tilting after windmills and giants.)